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The future -- not what it used to be: Global trends and extension

Britt Toscano

Department of Primary Industries, Queensland
Business Strategy Unit, GPO Box 46, Brisbane Q 4066, ph 07 3239 0501

Why global trends?

We are immersed in a time of rapid change, driven by wide range of global trends in society, technology, economics, the environment and politics.

With a little foresight, these emerging global trends can provide countless opportunities for primary industries and agribusiness enterprises to prosper into the future. Imagine being able to take advantage of emerging consumer behaviours, or know which environmental issues will be important in the coming years, or where our key markets and strengths will lie in the future.

DPI has developed a suite of Global Trends products which includes a video and workshop package titled 'The Future -- Not What it Used to Be', and a series of five Global Trends Business Briefs which summarise years of research into global trends. These products will help you to gain an insight into these bigger picture trends so that you can take advantage of the opportunities they present.

Change and the future

Change is nothing new - we adapt to it every day of our lives. What is new is the rate of change we are experiencing, which is accelerating at an unprecedented rate.

So how do we face this change, make decisions, and plan for a future that will be so different from today? One way to keep abreast of change is by having an external focus on the emerging global trends around us.

An external focus has not always been so important in planning for the future. Back in the 'good old days' when change was less rapid and often less dramatic in its impact, strategies tended to focus on improving our own business - how we do things, cost cutting, production efficiencies, and so on.

In today's face of rapid change, this is no longer a viable option. New technologies and a whole new global system - globalisation - are forcing us to be savvy to international trends. This knowledge will be the gold of the 21st century. It will be what separates the 'haves' and 'have-nots', becoming the 'knows' and 'know-nots' of the 21st century.

Even with the best information on these trends, we cannot predict the future with any certainty - discontinuous issues or events may emerge from time to time that significantly alter the path of the future. Past examples include the motor car and more recently the Internet. What we do know for certain, is that there are countless trends emerging that will impact upon us in the future.

This paper will look at five key global trends - population change, biotechnology, globalisation, international law, and ethics and the environment - and the implications and opportunities they present. This is an example of the kind of trends, opportunities and implications discussed in DPI's five FREE publications known as the Global Trends Business Brief Series.

Population change

It took all of human history to reach a world population of 1 billion in 1800. It then took only 130 years for the population to double. During the next 70 years, the population had trebled to 6 billion by 2000.

World population is currently growing at around 80 million people per year. At this rate, we are adding the equivalent of Australia's population to the world every 10 weeks.

However this population growth is not evenly spread. In fact there is a striking dichotomy - 98 percent of global population growth is occurring in developing countries, while populations in developed countries are actually declining as people are opting to have fewer babies.

Women must have around 2.2 babies each to maintain a population. In many developed countries, the birth rate is significantly lower - in Western European countries it averages 1.3, in Japan it is 1.5 and even in Australia, our population will not be maintained with our current birth rate of 1.8 babies per woman.

So in contrast to developing countries, developed countries are actually on the doorstep of an Agequake. The post-baby-boom decline in birth rates since the 1970s, matched with improved living conditions and medical advancement, has meant that there are currently around 600 million people over the age of 60. By 2050, it will be around 2 billion, equivalent to a quarter of the world's population.

Population changes will have significant implications for food and fibre industries. To feed the burgeoning population, the world will need to produce more food in the coming 30 years than it has in the whole of human history, but the area of land and the availability of water will fall.

While there may be opportunities for food and fibre exports to some regions, particularly in Asia, the highest population growth is likely to be in regions where poverty and food security are key issues. Servicing low value markets such as these will not be lucrative for most Australian primary industries.

A decline in the population of developed countries - largely our key markets - may result in a reduced demand for goods and services. It is expected however that economic growth in these countries will continue to occur, meaning that consumers will be seeking higher value products.

The aging population will present perhaps the most exciting and lucrative opportunities. In 2010, the first of the baby boomer generation will begin to retire. This is the generation that has had it all and doesn't want to grow old! As a result, they will be seeking health and wellness through what they eat. They will demand functional food - food that imparts an additional health benefit other than basic nutrition. Already we are seeing the symptoms of this on the supermarket shelves such as soy products to alleviate the symptoms of menopause, mono-unsaturates for a healthy heart, and fermented milk products for inner health.

However food is not the only area in which opportunities will arise. Older people, with their children off their hands, will have more leisure time and more money to spend on themselves. We will see increased spending on travel, self-education, cultural activities and self actualisation activities, to name a few.

Urbanisation will continue to occur, especially in the sun-belt regions. Public spending and private investment will also reflect the needs of an aging population, and be concentrated in urban areas. Politics are likely to become more conservative with security, law and order high on the agenda.

Modern biotechnology

Biotechnology has been used for centuries in processes as simple as making bread, brewing beer and making cheese. In short, biotechnology involves the use of living systems to produce food, medicine and chemicals.

These processes do not however explain or encompass the characteristics and processes of modern biotechnology, which uses new knowledge, technologies and techniques to modify, create or select specific biological processes or characteristics. It encompasses a suite of technologies involving living systems, including genetic modification, genetic transfer, genome mapping and cloning, all overlayed with modern microprocessor and digital technology.

The potential for biotechnology is virtually unlimited, however the main areas in which it is being applied are medicine, health care, agriculture, manufacturing, mining and the environment.

Biotechnology's application to food and fibre production, and the development of Genetically Modified Organisms (GMOs) is the most talked about and debated within government, industry, the media, interest groups and the general public.

In this particular application, biotechnology is currently in its first wave, whereby it is largely focused on manipulating the traits that might improve the food and fibre production process, for example pest or drought resistance. First wave technologies have not been readily accepted by consumers in many countries, as there seems to be little discernible benefit for the consumer, and a perceivable risk to both the consumer and the environment.

The benefits of first wave technologies are largely being reaped by the companies who own the intellectual property. In addition to this, the benefits being promised to producers, such as increased yield, may cause further price pressure in an already price squeezed market.

Second wave GMO technology will see efforts to improve taste and shelf life of foods, while the third wave will be by far the most exciting, with the development of functional foods and nutraceuticals - foods that are genetically engineered to contain vaccines, drugs and other vital pharmaceuticals.

This may be one way to service the growing demand for health and wellness from an aging population. It may also provide opportunities for high value farming of specific genetically modified crops for the pharmaceutical and medical industries.

Other alternative opportunities arising from biotechnology include the option of servicing the market for GMO-free and organic food and fibre.

Much of the potential for biotechnology in food and fibre production is going to be dependent on consumer attitudes and acceptance. In its current form, there appears to be more resistance than acceptance, however as biotechnology begins to deliver some of the promises of the third wave applications, we may see potential benefit outweighing potential risk in the mind of the consumer.

To ensure that we are not left behind in this brave new world of science, significant public and private investment has been made into biotechnology research and development in Australia.


Over the past decade, the world has undergone an unprecedented transformation, driven by the end of the Cold War, the growth of free and open trade, the advent of the Internet, the decline in communism and the democratisation of financial markets. This new system, known as Globalisation, is shaping global and national economies, domestic politics, international relations, business activities and individual behaviour.

It is presenting new opportunities for countries, industries and businesses to undertake commerce on an international scale, that until recently, were inconceivable.

Individuals are beginning to think and act globally, with more access to information, goods and services, and other people and cultures than ever before. The decline in communism and the ease of access to international travel also mean that people are travelling more than ever, experiencing cultures, cuisines and lifestyles from all over the world. As such, they are becoming more sophisticated consumers, demanding immediate and year-round access to goods and services, facilitating global supply chains to meet growing needs.

Globalisation also has its downside. Recent anti-globalisation protests in Seattle and Melbourne reflect the sentiment of those who are feeling disenfranchised by the new system. Some feel that globalisation is continuing to widen the gap between the 'haves' and 'have-nots', and that it is forcing industries and businesses into economic rationalism, despite the apparent inequities with competing nations.

Globalisation is having a significant impact in Australian primary industries, which have undergone widespread deregulation in recent years. For example, Australia must now compete in both domestic and export markets against competitors with much lower cost structures.

Globalisation is providing many opportunities. The opening and restructuring of many foreign markets, matched with the potential of e-commerce, is providing market access for specialty and high value products to niche markets. With its stable economic and political environment, Australia is increasingly attractive to foreign investment and tourists.

Australia has a long history in primary industries, providing us with a rich knowledge and intellectual property that represents a valuable commodity for future export. Australia has the opportunity to export knowledge in areas such as production and processing technology, land and water management, plant and animal breeding, managerial skills, education, marketing and communication.

International law

In the past few decades, globalisation and the growing realisation of the need for global rules on issues such as human rights, security, free trade, the environment and the world's cultural and natural heritage, has led to an increase in the scope and degree of acceptance of international law.

There are now some 34,000 international treaties, constraining or otherwise affecting the behaviour of national and sub-national governments, industries, non-government organisations and ordinary people. On issues transcending the jurisdiction of individual nation states, treaties provide sets of rules and describe agreed norms and practices which underpin international commercial, political, military and other activities.

The role of international treaties in managing the environment is likely to increase, and already there are around 1,000 relating to the environment, governing specific eco-systems such as World Heritage areas (eg Great Barrier Reef Marine Park, Fraser Island), and global resources such as the earth's atmosphere and global warming.

On the economic front, the World Trade Organisation is charged with developing international non-discriminatory and trade liberalising policy.

While nation states, especially those with small populations, generally benefit from international treaties, some have successfully argued for exemption or special treatment in some cases. For example, developing countries are not included in the Annex 1 list of signatory to the Kyoto Protocol on emissions reductions to combat global warming. These countries argued that their economic development is dependent on polluting industries, just as it was for the now developed countries in the past.

Other countries feeling the economic sting of international treaties are seeking to protect their sectoral interests with creative policies that fall outside of the realms of global laws. Multifunctionality is a concept being adopted by EU countries in an attempt to overcome restrictions put in place by WTO on their protectionist policies. The EU argues that support for farming is necessary to maintain the valuable contribution it makes to society, that is not measured purely by economics - farming has high social, cultural and environmental values for which the WTO has no rules and regulations.

As the number and scope of international treaties increases, Australia's responsibilities and obligations under them will increase, particularly in respect of issues such as sustainable development and resource management.

While Australia may at times feel threatened by diminished national sovereignty, we have the opportunity to become world leaders in upholding the principles and values underpinning these international treaties, and open the way for global marketing of ethical and environmentally friendly industries, good and services.

Ethics and the environment

Environmental sustainability moved from being a buzzword in the 1980s to being a pervasive consciousness in the 90s and into the 21st century, and no doubt will be a prerequisite for business in the future.

This growing consciousness is driven by information. Like never before, people are gaining awareness of global environmental issues and who is doing what about it. Individuals are now, and will continue to, take an interest in their local and global environment, their own and other's impact upon it.

With increased environmental consciousness comes an increasing acceptance of global long-term perspectives in business, politics, national decision & policy making.

We are seeing the establishment of global environmental ethics and international cooperation in achieving sustainable development. This is largely in the form of international treaties, however it is becoming more and more evident in the market place.

In addition to this, people are becoming increasingly aware of, and responsive to, ethics in business, government and politics. Issues of human rights, animal rights, native title and reconciliation, to name just a few, are becoming high priorities on public and private agendas.

Out of these new paradigms come new concepts for business and government - intergenerational equity is the concept of leaving our planet to future generations in as good as or better state than it is today; sustainable development is human development (financial, economic and social development) in harmony with the natural environment; and eco-footprinting is the assessment of our current usage and 'fair share' of global resources.

While environmental consciousness and the concepts that flow out of it have, in some cases, led to the implementation of legislation that restricts or impinges on our ability to do as we please, they have also provided, and will continue to provide, many opportunities.

Businesses and government are realising the potential of ethics and the environment in marketing. New and lucrative industries are emerging, such as emission credit and environmental credit trading, renewable energy production, eco-tourism, organic food and fibre production, and the sale of intellectual property.

While still in the early stages, these industries represent the new high value exports for Australia in the future. For example, Australia's emerging organics industries are securing market share among mainstream consumers both here and overseas.

Looking into the future, businesses committing to sustainable development are likely to do so in order to improve their reputation and brands, implement their values and principles, gains a commercial edge, and keep costs down.

Government, politics and businesses will increasingly adopt a 'Triple Bottom Line' approach - taking into account the economic, social and environmental bottom line of their policies and activities.

DPI's Global Trends Business Briefs

DPI's Global Trends Business Brief Series are available FREE on the DPI web site at Search under “global trends” using the DPI search engine.

The five publications look at the following trends as well as the implications and opportunities they present, with a focus on Queensland's food and fibre industries and rural communities.

Social trends

Population growth, under-population, agequake, urbanisation, women, cultural diversity.

Technology trends
Innovation and advances in technology, nanotechnology, information-communication technology, sensor technology, technology convergence.

Economic trends
Globalisation, the network age, electronic-commerce, value-chain management, knowledge as a competitive advantage

Environment trends
Environmental consciousness, sustainable development, integenerational equity, global warming, alternative energy

Political trends
Dictatorships to democracies, war and peace, international law, national sovereignty.

DPI's Global Trends Workshop

The Future -- Not What it Used to Be is DPI's saleable video and workshop package about global trends and opportunities. The workshop package has been very successful to date with over 1100 participants including community groups, producers, business people and government officers.

The workshop looks at change and our thinking patterns, “warming up” the participants before the global trends video and brainstorm sessions. These sessions explore population trends, globalisation, functional foods, biotechnology, ethical and environmental consciousness.

A strategic questioning activity brings global trends down to a practical level where workshop participants can develop their own ideas into an action plan to take home.

The workshop package is available for $148.50. Phone DPI Call Centre 13 25 23 for more information.

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